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Consider two semiannual coupon bonds each with 1 year of maturity. The face value of each bond is 1000. The annual coupon rate of bond 1 is 4% and the annual coupon rate for bond 2 is 8%. What are the continuously compounded annual zero rates for 6 months and 12 months if the price of the bond 1 is 1020$ and price of bond 2 is 1058$?
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